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Motoring Costs Rise 5.8% 2011

Huge rise in Fuel Prices the major culprit

The cost of running a family car in Ireland has risen by 5.8% per cent in the last 12 months, according to the AA's annual survey of motoring costs. It now costs €11,817 to run a small family car in the 'Band C' tax category (typical engine size of 1251 – 1500cc) for a year; up by €646 on the figure for 2010.

"Of course the single biggest change is the cost of fuel.” Says Director of Policy Conor Faughnan. “In June of 2010 petrol cost 133.3 cent per litre, but by June of this year that had risen to 151.7 cent. This is a surge of more than 12%, something that motorists are certainly feeling in their pockets.”

Other key motoring costs did not fare so badly. Motor insurance did rise in the last year but only slightly, averaging 1.2% higher than last year. There are also indications that insurance costs fell back again in the last 6 months. The cost of servicing and of repairs and replacements rose but only in line with inflation at 2.7%. The ECB’s base interest rate rose from 1% to 1.5% which affected the cost of car finance.

 “While the AA does its calculations based on the total cost of car ownership, in terms of running costs motorists think of fuel and then Insurance. The cost of insurance is high and even rose slightly. Motorists are encouraged to shop around and to look at the nature of their cover. It is one of the biggest bills that motorists pay, but there are ways of getting it down.”

The purchase price of new cars actually fell slightly overall but that was a mixed effect. Cars in the lower Band A and Band B categories fell slightly in price (just less than 2% compared to 2010), reflecting greater competition and increased consumer interest in this end of the market. Other categories were not included in the government scrappage scheme and have seen slower sales.

The AA calculations show that a car that achieves 30 miles per gallon (9.5 litres per 100kms) and does 1600 kilometres per year will use 1500 litres of fuel. Last year that cost worked out at € 2,000. In 2011 the cost is €2,301.

AA figures are currently based on petrol usage, rather than diesel. Diesel cars are still in the minority of private cars on the road but which a huge switch to diesel fuel for new car purchase in recent years that is likely to change. Over 70% of new cars sales so far in 2011 are diesel models, and over 90% were in the Band A or Band B categories.

AA Ireland Limited trading as AA Insurance is regulated by the Central Bank of Ireland.